Inside Wells Fargo's Incubator for 'Cleantech' Startups

Inside Wells Fargo's Incubator for 'Cleantech' Startups

Article excerpt

Byline: Mary Wisniewski

Many banks are trying to nurture innovative tech startups to transform their industry; Wells Fargo is also taking this approach to help any industry slash energy consumption.

The Wells Fargo Innovation Incubator is a five-year initiative that is co-administered by the U.S. Department of Energy's National Renewable Energy Laboratory. Announced last year by the bank's philanthropic arm, it connects entrepreneurs to funding, technologies and experts -- all needed to help startups tackle their daunting business journeys in an area where traditional venture capital financing has been drying up.

Mary Wenzel, head of environmental affairs at Wells Fargo, said there's a gap in funding between research and development and commercialization that holds back many clean-energy startup companies. The incubator, which announced its first batch of participating startups in April, is meant to help address this gap.

"This program is really designed to help a leading entrepreneur move quickly through that valley," said Wenzel.

The philanthropic initiative arrived ahead of the Obama Administration's announcement in February of the Clean Energy Investment Initiative, a program that seeks to catalyze $2 billion of expanded private sector investment in cleantech initiatives. IN2, which was cited in the White House's announcement as an example of what that could look like, has been seeking out technologies that could slash the amount of energy buildings guzzle -- an area that's ripe for change. According to the Department of Energy, roughly 40% of energy consumption in the U.S. came from commercial and residential buildings in 2013.

"The market opportunity for energy transformation is huge," said Robert G. O'Connor, a corporate partner at Wilson Sonsini Goodrich & Rosati.

It's also smart business.

"The mandate has become more and more clear among big corporations that energy is increasingly a strategic asset," said O'Connor, whose firm works with Silicon Valley tech giants on their clean energy strategies.

Certainly, big banks have been upping their environmental work. Citigroup announced in February it's committing $100 billion over the next 10 years to helping reduce the effects of climate change. PNC, for another, is working to make its future headquarters building the greenest skyscraper in the world. And Bank of America is in the midst of a 10-year, $50 billion environmental business initiative, in addition to committing $75 billion through lending and other financing to reduce carbon emissions.

Wells Fargo's incubator, which is but one part of the San Francisco bank's promise to provide $100 million in grants and increased volunteerism to environmentally-focused nonprofits, is seen as a unique way for the San Francisco bank to serve as an environmental steward. …